Bandt mistaken on performance bonds

I have no doubt
Adam Bandt
is an earnest environmentalist and keen re-elected MP, but perhaps he should seek advice before telling the Export Finance and Insurance Corporation how to do business. Referring to EFIC’s provision of a performance bond, his statement, (AFR Oct 8): “EFIC urgently needs to explain to Parliament how it intends to recover any money given to Leighton", displays complete ignorance of what a performance bond is.

A performance bond is not finance provided to a contractor, it is a form of guarantee provided to the party to whom services have been contracted. While the provision of a performance bond supports an organisation in winning a contract, it can hardly be construed as a case where the “government bankrolled [the] Leighton deal," as the article's headline suggested.

EFIC has a vital role in supporting the international business endeavours of Australian organisations large and small. To target EFIC in an exercise in political point-scoring is detrimental to the health of Australian business. EFIC's role is vital and should be supported by all parties.